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  • Section 69 (2) of the Indian Partnership Act
  • Section 69 of the Indian Partnership Act
  • Section 69 of the Indian Partnership Act, 1932
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citation codes
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Disposition
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  • Section 69 (2) of the Indian Partnership Act
  • Section 69 of the Indian Partnership Act
  • Section 69 of the Indian Partnership Act, 1932
Smart Summary

Factual and Procedural Background

The petitions involve multiple Multi Service Operators (Petitioners) against MSM Discovery Pvt. Ltd. (Respondent), a Broadcaster/Content Aggregator. After extensive negotiations, the parties executed a Subscription Agreement dated 14.9.2012 for the period from 01.10.2012 to 31.12.2012. The Petitioners paid the subscription amount in advance and received IRD boxes from the Respondent, except in one petition. Despite payment and supply, the Respondent did not activate the IRD boxes. Consequently, the Petitioners filed these petitions seeking directions to the Respondent to activate the decoder boxes, provide counter-signed copies of the agreements, and enter into fresh agreements on the same terms after expiry of the current period. The petitions also included an interim prayer for activation of the IRD boxes pending final hearing.

Legal Issues Presented

  1. Whether the Respondent is obligated to activate the IRD boxes supplied to the Petitioners despite the agreements not being counter-signed by the Respondent.
  2. Whether the Petitioners, including partnership firms without valid postal registration certificates or registered partnership deeds, are entitled to activation of IRD boxes.
  3. Whether Section 69 of the Indian Partnership Act, 1932 applies to the Petitioners who seek signals from the Respondent for supply to cable operators.

Arguments of the Parties

Petitioners' Arguments

  • The Subscription Agreement dated 14.9.2012 was duly executed by the Petitioners, specifying the validity period and payment terms.
  • Advance subscription payments for three months were made at the time of agreement execution.
  • IRD boxes were supplied by the Respondent and payment for these boxes was made.
  • The Respondent has failed to activate the IRD boxes despite reminders dated 5.11.2012 and 12.11.2012.
  • Section 69 of the Indian Partnership Act, 1932 is not applicable to the Petitioners as distributors of TV channels include individuals, groups, firms, or organizations without the necessity of registration.
  • Petitioners are willing to submit postal registration certificates wherever expired.
  • Precedent judgments of this Tribunal hold that Section 69 is not applicable for supply of signals to cable operators.

Respondent's Arguments

  • The agreements produced by the Petitioners are not binding as they have not been signed by the Respondent.
  • The subscription payments, although made, do not validate the unsigned agreements.
  • Some Petitioners lack valid postal registration certificates or registered partnership deeds, which are prerequisites for entitlement.
  • Section 69 of the Indian Partnership Act requires partnership firms to be registered, and non-registration disqualifies certain Petitioners from activation of IRD boxes.
  • The Respondent initially sought time to file a reply but ultimately argued without submitting a formal response.
  • Later agreed to activate IRD boxes only for Petitioners with valid postal registration certificates, objecting to activation for unregistered partnership firms.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Judgment dated 27.7.2011 in Petition No. 67 (C) of 2009 Section 69 of the Indian Partnership Act, 1932 is not applicable for supply of signals to cable operators. Supported the court’s prima facie view that Section 69 does not apply in these cases.
Judgment dated 14.8.2012 in Petition Nos. 50 (C) and 51 (C) of 2012 Same principle regarding non-applicability of Section 69 of the Indian Partnership Act for signal supply. Reinforced the Tribunal’s finding that partnership registration is not a prerequisite for activation of IRD boxes.

Court's Reasoning and Analysis

The Court examined the Subscription Agreement and noted it was signed only by the Petitioners and not by the Respondent. Despite this, the Court acknowledged the Petitioners had paid the subscription amount in advance and received the IRD boxes. The Respondent failed to activate the boxes and delayed filing a formal reply, though it contested the binding nature of the unsigned agreements and raised issues regarding the validity of postal registration certificates and partnership firm registration.

The Court considered the Respondent's objection based on Section 69 of the Indian Partnership Act, 1932, which requires partnership firms to be registered. However, relying on prior Tribunal judgments, the Court held prima facie that Section 69 is not applicable to distributors seeking signal supply from broadcasters. The Court noted that distributors include individuals, groups, firms, and organizations without the necessity of registration under Section 69.

Balancing the facts and legal principles, the Court directed the Respondent to activate the IRD boxes supplied to Petitioners within three days, subject to the rights and contentions of the parties and without prejudice to any further orders.

Holding and Implications

The Court's final decision is to direct the Respondent to activate the IRD boxes supplied to the Petitioners within three days from the date of the order.

This interim order is without prejudice to the parties' rights and contentions and does not constitute a final adjudication on the merits. The decision does not set a new precedent but applies existing principles from prior judgments regarding the non-applicability of Section 69 of the Indian Partnership Act to distributors in the context of signal supply.

    ESWARA COMMUNICATION v. MSM DISCOVERY PVT.LTD.

    TELECOM DISPUTES SETTLEMENT & APPELLATE TRIBUNAL

    NEW DELHI

    Dated 3rd December, 2012 Petition No. 827 (C) of 2012

    Sree Devi Digital Systems (Anakapalle) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 828 (C) of 2012

    Sree Konark Digital Systems (Srikakulam) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 829 (C) of 2012

    Sree Devi Digital Systems (Tuni) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 830 (C) of 2012

    Sree Devi Digital Systems (Vizianagaram) …Petitioner

    Page 1 of 8

    Vs. MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 831 (C) of 2012

    Sree Devi Digital Systems (Rajahmundry) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 832 (C) of 2012

    Eswara Communications (Vijaywada) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 833 (C) of 2012

    Vijay Communications (Krishna) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Petition No. 834 (C) of 2012

    Sree Devi Enterprises (Kakinada) …Petitioner Vs.

    MSM Discovery Pvt. Ltd. …Respondent

    Page 2 of 8

    BEFORE:

    HON'BLE MR. P.K.RASTOGI, MEMBER

    For Petitioner : Mr. Jayant K. Mehta, Advocate Mr. Sharath Sampath, Advocate

    For Respondent : Mr. A.C. Mishra, Advocate Ms. Vidya Prabhakaran, Advocate

    ORDER

    Petitioners in these petitions are a Multi Service Operators and the Respondent is a Broadcaster/Content Aggregator as described under the Regulations.

    2. Petitioners claimed that after the long process of negotiations between the parties, the commercial terms of the Subscription Agreement were settled and the parties entered into a Subscription Agreement dated 14.9.2012 for the period 01.10.2012- 31.12.2012.

    3. On 25.9.2012, the IRD boxes were supplied to the Petitioner in all matters except in Petition No. 833 (c) of 2012 and the payment for IRD Boxes was also made to the Respondent on 11.10.2012. According to the

    Page 3 of 8

    Petitioner, an advance of Subscription Amount of three months for the months of October, 2012, November, 2012 and December, 2012 was paid on 14.9.2012 at the time of execution of the agreement but the Respondent has not yet activated the IRD boxes. Therefore, the Petitioner has filed these petitions inter-alia for the following reliefs:-

    (i) Direct the Respondent to activate the decoder boxes of its channels issued to the Petitioner;

    (ii) Direct the Respondent to provide counter signed copy of the Agreements.

    (iii) Direct the Respondent to enter into a fresh agreement with the Petitioner from the date of expiry of the period of three months on the same terms and conditions.

    4. In its interim prayer, the Petitioners requested to direct the Respondent to activate the decoder boxes of its channels pending final hearing in the matter.

    5. The Respondent asked time to seek final instructions and time to file a short reply. When the matter was called for hearing on the interim matter on 23.11.2012, the Respondent did not file the reply, however, he argued on the interim matter.

    Page 4 of 8

    6. Mr. Jayant Mehta, learned counsel appearing on behalf of the Petitioner brought to our notice the copy of the agreement signed on 14.9.2012. The agreement shows the document number as well as period of validity starting from 01.10.2012 to 31.12.2012. The validation form shows the monthly amount to be paid to the Respondent.

    7. However, Mr. A. C. Mishra, learned counsel appearing on behalf of the Respondent pointed out that these agreements have not been signed by the Respondent. It is noticed that these agreement have been signed only by the Petitioners. The counsel has shown the payment of subscription amount dated 14.9.2012 for three months by way of post-dated cheques of 31.10.2012, 30.11.2012 and 31.12.2012 for an amount of Rs.54,836/- in Petition No 827 (C) of 2012. This paper is at page 31 of the paperbook, which shows that the distributor of the Respondent has received the same. Similarly a document dated 25.9.2012 has been shown which shows that IRD boxes has been supplied to the Petitioner where the distributor of the Respondent as well as the Petitioners have signed.

    8. The Petitioner has reminded the Respondent on 5.11.2012 wherein the Respondent was requested to activate the IRD boxes as well as return the counter-signed copy of the agreement signed between the parties on

    14.9.2012.

    Page 5 of 8

    9. The Respondent was reminded again on 12.11.2012. The Respondent has produced a chart before us about these petitions. We may reproduce the letter dated 5.11.2012 as under:-

    S.No. Petition No. Nature of Firm Status of P&T Certificates
    1. 827 (C) of 2012 Sole Proprietary Expired on 31.7.2012
    2. 828 (C) of 2012 Partnership Expired on 13.6.2012
    3. 829 (C) of 2012 Sole Proprietary Expired on 15.7.2012
    4. 830 (C) of 2012 Sole Proprietary Valid till 2.3.2013
    5. 831 (C) of 2012 Sole Proprietary Valid till 16.3.2013
    6. 832 (C) of 2012 Partnership Expired on 27.10.2012
    7. 833 (C) of 2012 Partnership Valid till 18.6.2013
    8. 834 (C) of 2012 Partnership Expired on 09.10.2012

    10. Mr. A.C. Mishra, learned counsel contends that the subscription amount has not been signed by the Respondent, therefore, the agreement copy produced by the Petitioner is not binding on it. In Petition No. 827 (C) of 2012, No. 828 (C) of 2012, No. 829 (C) of 2012, No. 832 (C) of 2012 and Petition No. 834 (C) of 2012, there is no valid postal certificate as on date. Similarly, the Petitioners in Petition Nos. 828 (C) of 2012, 832 (C) of 2012, 833 (C) of 2012 and 834 (C) of 2012 are the partnership firms but registered partnership deal has not been filed. Therefore, the Petitioners are not entitled for the activation of the IRD boxes.

    Page 6 of 8

    11. Mr. Mehta, learned counsel has pointed out that although these petitions has been filed on 19.11.2012, the Respondent has chosen to send an e-mail to the Petitioner on 22.11.2012 after filing of these petitions. This e-mail does not mention anywhere that the agreement between the party has not been executed. The Respondent has raised an issue of Postal Registration Certificate for the first time. Mr. Mehta, submits that he is ready to submit the Postal Registration Certificate immediately to the Respondent wherever period of registration has expired.

    12. Mr. Mishra, learned counsel later agreed that the Respondent will activate the IRD boxes of the Petitioners in the petitions having valid Postal Registration Certificates. However, he has a strong objection for activation of those IRD boxes wherever the partnership firm has not been registered as according to him, it is necessary that partnership firm should be registered as required under Section 69 of the Indian Partnership Act, 1932.

    13. Mr. Mehta, has brought to our notice that Section 69 of the Indian Partnership Act, 1932 is not applicable in these cases, as the distributor of TV channel means any person including an individual and group of persons, public or body corporate firm or any organization.

    Page 7 of 8

    14. Mr. Mehta has also brought to our notice a judgment of this Tribunal dated 27.7.2011 in Petition No. 67 (C) of 2009 and in judgement dated 14.8.2012 in Petition No. 50 (C) of 2012 and 51 (C) of 2012 wherein it was held that Section 69 of the Indian Partnership Act is not applicable for supply of signals to the cable operators.

    15. In view of our clear findings in various judgements, prima-facie, I am of the view that Section 69 (2) of the Indian Partnership Act is not applicable in these cases, where the Petitioners seek signals of the Respondent.

    16. Therefore, in view of the aforementioned reasons by way of interim order, it is directed that Respondent will activate the IRD Boxes supplied to the Petitioner within a period of three days from the date. However these orders will be without prejudice to the rights and contentions of parties and is subject to any other or further orders.

    …..……….. (P.K. Rastogi) Member

    HKC/

    Page 8 of 8

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    ESWARA COMMUNICATION v. MSM DISCOVERY PVT.LTD.
    (Dec 3, 2012)